How Market Research Enables Future-Ready Digital Products
Having a thorough understanding of customer wants, needs and behaviors is integral to any business, and all the more so when developing a digital product or platform. No matter how much work and innovation have gone into it, your product simply cannot succeed if it isn’t meticulously designed for the exact market at hand.
Market research is a key pillar in positioning your product for maximum user adoption. By continually gathering insights into industry and consumer trends, your teams can ground their design choices in real-world, real-time findings. This practice helps ensure a user experience that is superior to the competition’s and that your desired audience will love.
Most companies in the digital space already conduct at least some form of market research to evaluate their solutions’ effectiveness, even if it is a periodic web search or an annual customer survey. However, only a portion are utilizing this powerful tool in ways that unlock its full business value.
With an understanding of the main types of market research and their business impact, you can better leverage the options available for collecting the information you need. The outcomes? An in-demand product, a loyal customer base and an increase in long-term ROI.
What is Market Research?
The term “market research” refers to a set of interrelated practices for collecting data about your target audience, competitors and overall product landscape. Though this may seem like a simple concept on the surface, market research is a nuanced methodology consisting of many different paths to knowledge.
To start, it is helpful to review the two main types of market research: primary and secondary research. Working together, these practices result in a deeper understanding of what your audience wants and how you can best deliver it.
Primary market research involves gathering information directly from existing and/or potential customers using either qualitative data, quantitative data or both. You can use quantitative primary research to gain numerical data on industry and sales trends, and qualitative methods (such as focus groups, interviews or surveys) to uncover the more personal aspects of the customer journey.
Primary research allows you to hear from real users, in their own words, what is and isn’t working within your digital platform. With this firsthand feedback, companies can make more user-centered decisions throughout the development process.
Secondary market research assesses existing data about your audience and industry as a whole. This involves learning which competitors are already vying for your customers’ attention, what types of solutions are performing best, and perhaps most importantly, what challenges and opportunities are coming up next.
A primary function of secondary market research is to improve audience segmentation—that is, your understanding of (and responsiveness to) specific sub-groups within your customer base. Secondary research methods can help you identify common traits and behaviors among your target segments, enabling you to focus your UX/UI efforts on the right user journeys at the right times.
5 Questions Market Research Answers for Your Digital Business
Is there a real demand for my digital product or platform?
Market research significantly reduces the risk of lost investment by validating your product’s business opportunity in its early stages. If the space you’re seeking to branch into is already saturated, for example, or if the customer problem you are addressing has already been solved, market research is will allow you to alter your course before launching an unviable solution.
Who am I up against, and what will give my platform an edge over theirs? Competitive analysis—knowing who your top competitors are, how they are performing and what plans they have for the future—is unskippable in the current business climate. Market research shows who you need to outshine and how, enabling you to stay ahead of the pack and navigate even the most competitive markets with confidence.
How are people talking about my brand? Word about your platform travels faster than ever with online reviews, social media and other outlets playing a growing role in consumer decision-making. Market research allows you to discover what people are saying about your product post-launch—the good, the bad and the ugly. With these insights, you can work to address any issues that may be negatively affecting your corporate reputation and lean into the elements that are receiving the most praise.
What is the right price point?
Market research is a necessary component in determining the right price point for your digital product or service. If your product costs significantly more than existing alternatives (or less, as this may raise customer concerns about its quality), you are unlikely to achieve your sales goals. Researching what your target audience is willing to spend on similar products in your space helps you arrive at the most appropriate amount.
How can my digital business become a trendsetter?
Successful digital businesses use market research for much more than just following industry trends; they take advantage of good market research to anticipate and mobilize for what’s on the horizon. Market research allows you to identify previously unseen market opportunities—and seize them before the competition. Effective market research helps create a more proactive and growth-minded approach throughout the company, leading to the most innovative solutions possible.
When and how your digital business leverages market research can be a defining factor in the success (or lack thereof) of your app, platform or other product. In an increasingly competitive market, now is the time to level up your market research strategy—and you have a wide range of options for doing so. Whether it’s primary data collected directly from individual members of your audience or secondary data on sales, technological developments or other trends in your space, these insights will provide the answers you need to keep moving your business forward.
Market research is a critical piece of the puzzle that is excelling in today’s digital business world. By gathering the types of data we’ve discussed in this article, and continuing to do so throughout the product development lifecycle, you’ll build new value and keep your brand and business where it needs to be: ahead of the competition.